DraftKings SPAC Boss Dumps 250K Shares

Posted on: November 14, 2024, 08:41h. 

Last updated on: November 15, 2024, 09:17h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Harry Sloan, one of the founders of the blank-check company that brought DraftKings (NASDAQ: DKNG) public, sold 250K shares of the gaming company.

DraftKings insider buying
DraftKings Vice Chairman Harry Sloan. A new filing with the SEC indicates he sold 250K shares on Tuesday. (Image: Bloomberg)

That sale occurred on Tuesday, according to a Form 4 filed with the Securities and Exchange Commission (SEC) late Thursday. Following that divestment, Sloan owns 316,322 shares of the online sportsbook operator, according to the regulatory document.

The filing doesn’t indicate the average price at which Sloan’s sale occurred, but based on DraftKings’ November 12 closing price of $41.71, 250K shares were worth $10.42 million at that time. Sloan was awarded 352 restricted stock units on November 7.

Formerly Chairman and CEO of entertainment giant Metro-Goldwyn-Mayer, Sloan was involved with Diamond Eagle Acquisition Corp., the blank-check company DraftKings executed a reverse merger with to become a publicly traded firm in 2020. He’s currently vice chairman of the gaming company’s board.

Not the First Time Sloan’s Been a DraftKings Seller

In fairness to Sloan, there have been occasions on which he’s been a buyer of DraftKings equity, but there are also other examples of him being a seller.

A June Form 144 with the SEC indicates that on the 14th of that month, Sloan sold 250K shares of DraftKings, grossing $9.53 million in proceeds. In early March, he disposed of 43K granted shares, according to another regulatory filing. That followed a sale of 254,354 shares on February 16, according to a Form 4 filing.

On that date, Sloan owned 1.1 million shares of DraftKings, indicating he’s pared that stake dramatically this year.

As DraftKings investors know, that’s not necessarily surprising as the stock has experienced a wave of insider selling — one often led by co-founders Matthew Kalish, Paul Liberman, and Jason Robins. That trio and other insiders rarely buy the shares, but the operator did unveil a $1 billion share repurchase plan earlier this year.

Sloan Known in Gaming SPAC Circles

Sloan has long been active in the special purpose acquisition company (SPAC) space.

Since 2011, Mr. Sloan has co-founded seven special purpose acquisition companies with his partners, including Jeff Sagansky and Eli Baker, raising aggregate gross proceeds of over $5 billion,” according to DraftKings.

In addition to DraftKings, Sloan and his partners also founded Flying Eagle Acquisition Corp., the blank-check company that executed a reverse merger with mobile gaming and esports provider Skillz (NYSE: SKLZ) in 2020, paving the way for that company to go public.

While DraftKings has been one of the better-performing de-SPAC-ed stocks in recent memory, the opposite is true of Skillz. That stock has been a value destroyer over the past several years and is down 18.11% year to date.